Gretchen Morgenson: Wall Street Really Does Enjoy A Different Set of Rules Than The Rest of Us

Gretchen Morgenson: Wall Street Really Does Enjoy A Different Set of Rules Than The Rest of Us

Gretchen Morgenson has earned a Pulitzer-winning career from exposing abuse and conflicts of interest on Wall Street. In this interview, she confirms that there is indeed a second set of rules that our elite financial institutions enjoy, largely unfettered by the constraints that apply to the rest of us.

Consequences for failure and fraud are very different under this second set of rules - in fact, they're practically rewarded.
Accountability, by all prudent measures, has become non-existent. The extraordinary measures the country deployed to deal with the great contraction in 2008 only served to exacerbate these imbalances.

What's sorely needed now is a national dialogue on whether we're willing to allow this to continue. What benefits are we receiving by enabling these elite to enjoy such different standards? What type of system and rules might work better for our interests?

Sadly, beyond the disorganized OWS outrage that has waned in visibility, there is no real cogent, organized public debate focused on this right now. A big reason is that Washington is actively avoiding such a dialogue. It was fundamentally complicit in creating the underlying factors resulting in the '08 collapse and it doesn't want brighter light helping the public understand that more clearly.

As a populace we have a decision to make: are we going to get more engaged and start articulating the reform we want to see? For if not, we're making a passive decision to allow the wealth gap to widen further.

In the meantime, Gretchen sees a lot of instability in financial markets that have been allowed to balloon further even though the underlying causes of the '08 crash haven't been resolved. She cautions investors to avoid risk (despite the Fed's encouragements), pay down debt, and have a defensive plan in place should the markets suffer another serious correction in the near future.

On The Two Sets of Rules

Honestly, the transfer of wealth that has been created, that has been taken from the saver -- and from the taxpayer, do not forget -- to “mend the financial system” or to keep it from falling off the cliff, is extraordinary.

When you talked about savers, these are the people as you point out that really had nothing to do with the crisis. They were in fact, doing the right thing, not buying more house than they could afford, putting away money for college education, etc. They are the ones who are really paying the price now.

I think that has led to a very angry populace but also a sense that there are two sets of rules in the country. That one set applies to big and powerful institutions that when they go awry are rescued quickly. Then there is another set of rules for the rest of us who do what we are asked to do, do what we are supposed to do, and really then become victims of the situation. It is very unfortunate and I think it is, as you say, corrosive.

On The Lack Of Accountability

The idea that forging signatures, that notarizing very important legal documents really improperly in thousands of cases -- maybe millions -- the idea that that is somehow is going to be allowed to go on with just sort of a penalty of some kind or a fine and not prosecuted in the criminal courts, I think it is amazing. It is really counter to what we have all been led to believe was the course of action in such a case.

You have many small people, small fry mortgage fraudsters who are in jail. I mean we are talking about the people who were straw buyers for homes who defrauded banks. They are in jail for a reason: because they perpetrated a fraud. These banks whose employees were forging signatures should also have been prosecuted with vigor and they were not. They were simply allowed to negotiate their way out of trouble and negotiate their way with shareholders money. They are not paying it out of their own executives' pockets; they are paying it out of the shareholders' pockets. There really is no accountability here whatsoever.

There were 1,100 criminal referrals in the S&L crisis and there were 839 convictions. That is a sizable number and far, far, far more than we have seen. I mean I think I can name one senior level person at a mortgage company who is in jail at the moment

On The Need For A National Dialogue

I am shocked that it has not led to a really honest dialogue already, this crisis, because it was so large and so devastating and it hurt so many people that I thought 'Wow, this is really it. This is going to force the issue to be brought in to the open, to be discussed intelligently and to be resolved'. It just has not been.

I mean I lay it at the feet of Washington because I think they were crucially involved in the crisis in the years leading up to it. There is a reason why they do not want to deal with it. There is a reason why they do not want vigorous investigations because it could very well lead back to an understanding that they were major contributors to the crisis.

You have this weird disconnect where the populace at large, many people are angry and concerned and discussing and dialoguing as you say on the Internet and in coffee shops. Washington: it just rings hollow for them. They just do not want to address it. This is the failure I spoke of earlier about how no dealing with Fannie Mae and Freddie Mac. No resolution for the big banks that are too big to fail. It is a deep, I think, dysfunction in Washington that may be a result of their understanding of how deeply involved they were in laying the groundwork for the crisis.

On Remaining Market Risk

The resolution to this crisis was supposed to be the Dodd-Frank Legislation of 2010. Unfortunately, it was I think not even close to what was needed to proscribe this kind of thing from happening. Again I think that first of all, Dodd-Frank did absolutely nothing about Fannie Mae and Freddie Mac. It was completely silent on those mortgage companies who were very central to the problems and are in to the taxpayer for $183 billion dollars. The fact that it was silent on that issue is very, very important to remember. We have no resolution in place, no suggestion of one for either of those companies.

The second thing that I think is a big failing of Dodd-Frank is that it did nothing about too big to fail institutions.That’s the powerful, politically interconnected financial institutions are not allowed to fail when they get in to trouble. If it had been me, I would have liked to have seen something that cuts these institutions down to a more manageable size and yet we did not force that on them at all. In fact, if you take a look at the assets at the top ten banks in the United States they are bigger; they are larger than they were before the crisis.

Those are two elements that I think have absolutely not been dealt with that leave us really vulnerable to another episode like this in the future.

Click the play button below to listen to Chris' interview with Gretchen Morgenson (runtime 20m:02s):

Good for them, being a veteran I'd like to think that I have access to a much larger and better connected force of brothers and sisters in arms. Fuck New York. Why people continue to rule out the possibility of a military-style coup in the U.S. is beyond me.

Thumbs down to the comments on how obvious the headline is. Though the average ZH reader knows this, it apparently has NOT resonated with the public-at-large, and thus needs to be repeated... not repressed.

What was I partitioning? I was replying to the post above mine that was doing that. It was that poster that was trying to turn this into a Republican or Democrat problem. I was trying to point out that they all suck, suck the big one, from top to bottom.

I wrote the following comment (more or less) after reading another recent article on ZH...What everyone needs to consider is why the politicians are doing nothing with respect to the big banks. The financial industry has grown so concentrated that a few very large companies control enough money to basically sway any electoral outcome. Yes, they have the power do donate untold millions (and possibly more) as a group to campaign coffers, unions and/or SuperPAC's and by doing so influence election outcomes. Don't think the politicians don't know this. The bankers also know that whenever there is a split congress or congress and exectuive branch, the banks will rule. The only thing the financial industry fears is a Congress and White house that is all owned by one party. During a period where the government is run by split parties, the banks keep the pols in line by letting them know that if the pols go against them, they will support the other party. Hence, neither party goes after the Big Banks. When you have one party controlling both houses of Congress and the White house, it give the pols a two year period to implement financial reform. Obama, Pelosi and Reid had this chance right after the big debacle and obviously failed. There are two questions going forward into the 2012 elections: Can the Republican Pary win it all? If they do WILL THEY DO SOMETHING TO BREAK UP TEH TBTF BANKS AND THEIR CORRUPTING INFLUENCE? I guess time will tell, but I'd like to see one journalist start asking the candidates about where they stand on this issue.

So you still think we have two parties, eh? Quaint, but false. We have one party with two different colors, both colors owned by the banksters. Make no mistake, a dem costs the banks the same as a repub, and they buy them both, thus why neither party does jack shit. They are owned. Supporting the myth that there are still two parties only perpetuates the problem.

It makes me happy that someone is calling it like it is, but I since a certain naivete. The light isnt brighter, and justice not done, bc the rot leads right to the very top. Corruption, open and blatant, is the rule not the exception now. This deep corruption leads to some very dark places. If both parties, and their politicos, are taking their marching orders from corps/bankers and the like how can the people be represented? Can this be a Republic if the people arent represented? Is not representation, or lack there of, just cause for revolution?

Having been here a while now it never ceases to amaze me how slow things move; I guess until they dont. The reason a false flag, and ww3, is coming is because slowly people will start to understand, and those in power will do anything to stop this realization from fully developing.

The truth is there is no just reason to be beholden to police who dont enforce the law equally, to pay taxes to a government in which you are not represented, or not to revolt
against a federal government that has destroyed the founding document and compact with the people upon which its power is based.

We have an opportunity, a small window, to act against burgeoning tyranny; right now. Most of you are too tied up in the system or too afraid, but the window is open right now ever so briefly.

I agree. It's always nice to hear someone "calling it like it is", but how much longer can we rely on words alone? The time to say no and disconnect from the system has come and gone, action is required now more than ever. The kind of progress or revolution that we frequently discuss here on ZH is not welcome in this environment, therefor it will not only be slowed to a crawl, it will be poisoned at any given chance so that it is paralyzed and eventually dies.

I believe in the power of ideas, but the only thing that TPTB understand is action.

"Resolve to serve no more, and you are at once freed. I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer; then you will behold him, like a great Colossus whose pedestal has been pulled away, fall of his own weight and break into pieces." ~ Boetie

Agreed. We need action, and I dont mean out of work college kids and hippies living in parks. A peaceful armed march to DC to demand a constitutional convention. A public petition refusing to pay taxes until demands are met would be good too. A nationwide workstrike. It would not take large percentages of the population to cause a real ruckus if any of these were chosen. Im willing to face death and imprisonment. Ive had it, and Id rather die on my feet. Im mad as hell and Im not going to take it anymore.

When powerful groups begin to lose their status and their source of wealth is threatened, they react by going on the offense. And yes, unreasonable things can happen. That was the basic story of many toppled governments, including the death of Weimar in the 1930s.

Militant: Dig it, dope peddler. We're out here building a new nation for black people. It's time for you to start payin some dues, nigga! Youngblood Priest: I ain't givin' you shit! I'll tell you what you do, you go get you a gun and all those black folks you keep doin' so much talkin' about get guns, and come back ready to go down, then I'll be right down front killin' whitey. But until you can do that, you go sing your marching songs some place else. Now we're through talkin'.

[Black Dynamite walks into the militant group's hideout] Black Dynamite: Excuse me, brothers. Militant #3: [Gets up] The militants turn, startled. This is private. How'd you get in here? Black Dynamite: I walked in. Militant 2: So you one of them sneaky brothers, huh? Or maybe you an undercover pig. Or maybe you just a federal hitman. Black Dynamite: If I was, you cats would already be dead. Now let me speak to the man in charge. Militant #3: Sarcastically, I'm in charge. [Exchanges hi-fives with the other militant] Black Dynamite: If you were in charge, the people might as well surrender to whitey right now, because your survival skills ain't worth a damn. Saheed: Black Dynamite. [Walks into the room] Saheed: It's been a long time, my brother. Black Dynamite: [Exchanging hi-fives with Saheed] What it is, Saheed? Militant 2: You know this Uncle Tom? Black Dynamite: Listen sucka, I'm blacker than the ace of spades and more militant than you and your whole damn army put together. While you out there, chanting at rallies and brow-beating politicians, I'm taking out any money-fronting sucka on a humble that gets in my way. So I tell you what, when your so called revolution starts, you call me, and I'll be right down front showing you how it's done. But until then, you need to SHUT the FUCK UP when grown folks is talking. Militant 2: I'm sorry. Saheed: Yeah, we heard about what went down at the Hip Pocket. That was righteous. Black Dynamite: That was personal, brother. Saheed: Personal or not, you saved a lot of brothers and sisters. You need our help, [pounds chest with right fist] Saheed: we're here. Black Dynamite: I can dig it. [Black Dynamite pulls the bullet casing from his pocket] Black Dynamite: What can you tell me about this? [Saheed takes the casing, sniffs the inside for gunpowder and licks the outer casing] Saheed: I ain't seen one of these in a while. [Black Dynamite and Saheed walk out of the room] Militant 2: [Whispers] I was gonna fuck him up.

NO, we don't need a fucking constitutional convention! We need to enforce the completely ignored constitution we have right now! Why the hell would you open the constitution for revision knowing that every politician, save a handful, is completely owned by the bankers??? You think that would turn out well? Christ, start thinking before spouting that nonsense. TPTB would LOVE a fricking CC just so they could grandfather in all the unconstutional shit they've been doing the past decades! We need to demand that our politicians comply with the oath they took when they were placed in office or get them the hell out of there.

Agreed, the one we have is excellent if anyone paid attention to it anymore. A new one would never work, there is little to no common ground on what we want moving forward. If we arent going to use whqat we have it makes more sense to split up into 3 or 4 regions and allow each to rewrite their own.

"THE METROPOLIS IS A TERRAIN OF CONSTANT LOW-INTENSITY CONFLICT, in which the taking of Basra, Mogadishu, or Nablus mark points of culmination. For a long time, the city was a place for the military to avoid, or if anything, to besiege; but the metropolis is perfectly compatible with war. Armed conflict is only a moment in its constant reconfiguration. The battles led by the powers resemble a kind of never-ending police work in black holes of the metropolis, "whether in Burkina Faso, in the South Bronx, in Kamagasaki, in Chiapas or La Courneuve." No longer undertaken in view of victory or peace, or even the re-establishment of order, such "interventions" continue a security operation that is always already at work. War is no longer a distinct event in time, but instead diffracts into a series of micro-operations, by both military and police, to ensure security."

- The Coming Insurrection, randomly selected passage

Don't be mistaken. Even if it is not obvious on the surface, it has been a while that the merger of the Military-Industrial Complex and the Paramilitary-Counterterrorism complex have merged their operations in a single goal of ensuring the security of CoG. The insurrection has been going on for a long time, and if you make the mistake of thinking it is not then of course you might get discouraged. But that might just be because you're not thinking straight.

The nature of the security state prohibits the masses from overorganizing. Organizing is good to get motivated, informed and moving, but once you get moving you need to eliminate as many factors that make you dependent on the masses as possible. Of course you won't be hearing about lone wolf insurrectionists.I cannot recommend reading this book too highly: The Coming Insurrection

With respect, my experience as an old guy has been that post-menopausal women are really, really hot. Talk to someone that has dated a cougar, young man. I'll take Mom over daughter on that one (Seymour) for sure!

The system is designed to make sure that your only choice is a cocksucker. For example, McCain vs. Obama or Romney vs. Obama. I think I made my point. I didn't even have to mention Bush, Kerry or Gore.

I have come to the same conclusion. The only way forward is to print, in ever larger amounts, until the entire world's system goes "Poof". They can't stop. They don't want to answer where the 401Ks and the pensions went in a burst of smoke. They would rather eat them away slowly and blame everybody else for the currency collapse.

The result is the same. It's just a matter of how quickly you remove the Band-Aid.

I think that's what IS going to happen, but unfortunately, it's going to be that much worse when it's time for recovery.

As the system of production atrophies under completely inverted reward-structures, our ability to return to an efficient economy erodes. If we made major changes in societal structure NOW, I'm pretty sure we could easily maintain our current standards of living.

If we wait another 10 years, though, it's probably going to cost a great deal of life and leisure. Pity, eh?

But...perhaps this is the best this big lot of domesticated primates can do. We're created by God in his image, after all.

So if WE'RE dumb, then GOD is dumb, and maybe even a little ugly on the side. --FZ

copy of my email to Congressman Brad Sherman and Wells Board this morning:

Dear Congressman Sherman,

cc: Wells Fargo Board Communications, Kutak-Rock

Bluntly, if I'd had a counterparty to discuss solutions with... I'd not now be homeless and the bondholders would have received full mortgage payment over the last several years on the house stolen by Wells Fargo's self-interested incompetence.

In my own case, its the disinterest and willingness of Wells Fargo/Wachovia to even do good business. But then again, the 'bailed out' really have no need to be concerned about how they run their businesses do they?

My own case is perhaps a simple way of understanding why these TBTF banks MUST be taken down. All I needed was a chance to replace my tenants. Wells Fargo refused to accept a full months payment (when I was only a month behind because of loss of those tenants) and then was pushed by them into a situation where I had no chance to get new tenants.... and then all their sub-contracted minions saw the greatest value for themselves in NOT finding any solutions.

So now the literally thousands of hours of work I put in to building a very viable rental has been beneficially passed on to someone lucky 'investor' while you continue to support this thievery in myriad ways.

Moreover, in a vain attempt to at least retain my residency in the Granny unit I'd built for my retirement (which was the reason for the re-finance... it wasn't for 'trips and cars' as everyone seems to assume) I then sought a short sale with people who said they'd allow my continued tenancy (in response to a post card solicitation... it wasn't some 'friend' or a scam.)

This, of course, failed... possibly since I wouldn't pay the bribe sought by the Real Estate agent who claimed to be working with an associate in the short sale department (he claimed both Wachovia and Wells Fargo operations were the same... I've also made clear that I understand the likely difficulty with substantiating this.)

I've heard nothing from 'Wells Fargo Board Communications". Clearly this Board will only respond to direct political pressure. Is it the political immunity of these Boards that allows them to behave so irresponsibly? Is it their friends in high places?

And on a related issue... I'd love to hear his (and his Party's) feelings about giving the "little people" the capability to meaningfully lobby also... once again... scale REQUIRES a viable capability for networking of the microtransaction.

Very interesting times we live in.

P.S. I'm not a lawyer... but the worst case I can think of would be to find that such a foreclosure as this is actually 'legal'... because that would truly mean that the law really is an ass (to paraphrase an old quote). And that these banks are truly irredeemable and have to go. Ya see, scaling issues are my specialty. And these banks haven't addressed their scaling issues. They don't want to.

Don't give her hard time for finally blowing the trumpet...better late justice than never! This is a fight that, unfortunately, will take time and as such it needs to remain at the forefront of peoples minds..she is a person who can greatly help with that cause. All you holier than thou, I told you so, I'm smarter than you morons should quit bragging unless you can show me where you have gotten the press on this issue that she has.

It is a deep, I think, dysfunction in Washington that may be a result of their understanding of how deeply involved they were in laying the groundwork for the crisis.

You think these clowns will suddenly have a spiritual awakening and feel some remorse for what they've done (what we've allowed) to happen to this world? It has nothing to do with them "not wanting to address it", they gleefully hold hands with the banks and skip down main street, looting, foreclosing and pissing on the boots of anyone that isn't a yes-man muppet.

It is a sickness that runs deep, too deep to save in this current system. Someone press the reset button.

Someone? Someone! Someone is you and me. Stop being afraid of cops, the taxman, and big brother; lets make them scared of us. Get off your ass and tell them to go fuck theemselves, and if they dont like that; eat lead. It is that kind of brass that will bring you your reset and nothing else. Choose otherwise and may your chains rest lightly because no one is going to it do for you; get it.

Different and secret set of rules allow some participants to win all the way. The small investor always loses:

"Since 1991 the CFTC has given secret exemptions from hedging regulations to 19 major banks and market participants, allowing them to accumulate essentially unlimited positions. [10] These exemptions were originally given in secret, coming to light only as the 2008 financial crisis unfolded and Congress requested information on market participants"

On June 25, 2008 Speaker Pelosi sent a letter to President Bush calling on him to direct the Commodity Futures Trading Commission (CFTC) to use its emergency powers to take immediate action to curb excessive speculation in energy markets, and to investigate all energy contracts. Despite growing reports of excessive speculation in energy markets, the CFTC has refused to take actions they have taken in the past.[13] The Energy Markets Emergency Act of 2008 was a failed bill that would have attempted to curb excessive speculation in the energy futures markets.

I always wonder, how would the Chinese government respond to a company excecutive(s) who nearly single handedly destroyed a portion of the economy? Because honestly, until some real dire consequences are visited upon some of our financial perpetrators, this crap will continue to repeat itself. If there were any justice, former countrywide exec anthony Mozilo would have stage 4 melanoma.

It seems, to me, that once a good idea becomes "a movement" it is all over. Why do we always feel the need to flock together? Everybody needs to protest in their own way.

Look at some of the most effective protestres. That Greek guy from yesterday used humor to skewer the Germans. His 5-minute clip probably has more power than OWS. Walstreetpro, armed only with an aluminum bat, made more impact than OWS. Where did that guy go?

There is no reason for movements. individuality is the answer to collectivism, not more collectives.

I disagree that the Tea Party and OWS were created by oligarchs on either side. These were grass roots movements that sprang up, then were very quickly co-opted and marginalized by the parties. Any grass roots populist movement that springs up will be immediately infiltrated and co-opted. This is nothing new.

"Illumicorp has designed a rogue candidate program to provide a voice for the dispossessed. This disperses the impetus for dissent among those who do not feel represented by our candidates and builds a database of potential dissidents."

As I tried to explain my video above, one of the big problems with the well-intentioned people who join these groups is that they are not willing or prepared to seek out and confront the counter-insurgents. They may sometimes be willing to confront outsiders who are labelled 'bad' (eg: banks, politicians, police, etc.), but deep down people seem to have a lot of trouble with internal dissent. They just want to get along with everyone...

People are also naturally affected by peer pressure, so a half-dozen counter-insurgents working in concert to gang up on a good idea with BS arguments and ill-will is typically enough to kill it... If we were to create a movement which focused in part on nullifying the counter-insurgents, I think it might be possible to make it effective.

=> ie: by identifying the many real problems (eg: how they disable movements), we get the opportunity to adapt and surpass them!

That being said, I agree with the poster above that it's basically online and individually that we have the best chance to have an impact. Plus, it's kind of nice to be on my couch rather than in a leaky tent, getting assaulted by cops... Furthermore, whereas OWS blocked me from canvassing with an effective script (http://betterinfos.com/wake-up-script.html), I can do what I want on my own :)

Tea Party wasnt created as a farce.. it was real and hijacked very quickly

the problem will always be that most people are stupid and love attention. So it is impossible to get large numbers to understand all the financial crimes and stay on the boring truths instead of the fanatic yelling points that divide the public.

you would have to make the movement away from politics.. make it so everyone left the big banks and did more P2P banking and kept their money in their local communities and barter more to put less and less into the federal system

but they have it figured out pretty deeply.. they love the poor handouts since that fuels the debt, same with wars on the other side.. they have multiple fronts

Don't worry Amerika, we know you have always had this complex for never having a Monarchy. I present to you your new Aristocracy. We are still working on the King part, it should be available shortly !

LOL. One fucking big Circle. Sheeples were too busy procreating and entertaining themselves ith large screen TV and Boat and large homes. Trailer Park trash back to where they belong. So what to do with the Lexus is the big fucking q.

But I have to also keep in mind that a lot of private citizens took advantage of what the system provided: buying a home with nothing down, running up giant size credit card debt. Then they walked away and stuck the banks ....We shouldn't be so naive to expect the banks to be left holding the bag...I know of a few people that lived high on the hog for a couple years then stuck it to the tax payer.

That attitude will get you in trouble. Many ZHers will not hear of blaming both sides. It can only be the bank side. Everybody needs to be held responsible, including the many people I know that are pulling the "I shouldn't have to pay" shit.

Banks that made risky loans deserve to take losses...but didn't have to. Since TBTF banks were able to not only shift that risk via CDS (and when it all went to hell, the taxpayer) but to profit by bundling and reselling that risky debt (rated AAA) - they just ignored any meaningful loan underwriting. The wanted loans to bundle and sell, they didn't care if people paid - wasn't their problem anymore.

If you loan a homeless man at the bus station $1,000 - and don't get repaid, is that his fault or yours?

Yes, consumers had an orgasm while being raped by the banks - but they were raped all the same.

A neighbor of mine refinanced his home using one of those drive-by appraisals then drained every ounce of equity he could as he lost his job and couldn't get another for three years.....Finally, after living in the home for two additional years, paying nothing, the bank forced him out....So now, all the neighbors anxiously await the next owner who will have to sink $100K into the home for repairs.

Again, a secured loan. The bank (or whomever) loaned him the money either:

A. Believed the value of the home exceeded what he borrowed and was willing to accept the house as payment if he defaulted. Fully understanding they may take a loss.

B. Didn't do any due diligence and gave him the loan because they were able to shift the risk of any loss by bundling the debt and selling it as a AAA rated bond and/or buying a CDS.

If your neighbor took out the loan with false information, took the money and skipped out he's a criminal. If he took out a loan to keep his head above water while unemployed - he did what most people would have likely done.

As an anecdote, that's all this is. Loans are backed by collateral and if this couple feel the contract they entered into should be defaulted on, well, there are legal channels to execute the agreement both parties entered into.

What you may be complaining about is the seeming ability of this couple to transform their equity into cash and allow the system to work its way through thus allowing them time to use their remaining equity up in "free" housing.

The person or entity that entered into this legal contract knew, or should have known this was a possibility and was willing to accept the risk. It's not like the olden days when Barney Frank was holding a gun to the lenders head and telling him he better make toe loan or else.

Besides which, the underwriter got paid handsomely for originating this contract whether it becomes performing or not. It would be nice if he were held accountable for originating junk, but with a wave of the magic wand it becomes prime and he sells it to the TSA 401 investment club.

Everybody's happy.

Either way, that's between them and their lender, I see no reason why the US taxpayer should be bothered with the issue from either one of these people unless they request for an adjudication of the legal terms.

The Occupy movement has been more of a symptom than a solution. The squeal of grinding metal, as the machine tears itself apart. Those powers that be have no real understanding of the processes at work, or they would not be destroying their own source of power.

Much as late stage monarchies lost sight of their function as leaders and came to view themselves as a end, rather than a means, so to have the thugs and gamblers running this system lost sight of the financial requirements of the economy and just view it as an opportunity to plunder.

The purpose of capitalism is the efficient allocation of resources. That doesn't mean plundering anyone and everyone.

"A big reason is that Washington is actively avoiding such a dialogue. It was fundamentally complicit in creating the underlying factors resulting in the '08 collapse and it doesn't want brighter light helping the public understand that more clearly."

Like most have been saying.

No one will ever be indicted for the systemic collapse because laws were passed and were enforced by regulation...by government itself. They knew exactly what was going on, they mandated it.

To indict anyone for it all, is for the government to indict itself.

Were there some who took advantage of "bad law" to enrich themselves?...certainly...Taylor, Bean & Whitaker being the most prominent here in Fla.

But the law was on the books to push any and all mortgages out the door (with penalties from government itself & "the industry" for not doing so) and pawn them off on Wall Street "investors" who promptly insured themselves against any loss.

Creating and then lending money as a matter of "public policy" irregardless of ones ability to repay is the chief reason it happened for without that, it would not have been possible. It led to shattered lives, destroyed credit for the lower and middle classes and untold riches and fleeting prestige for those at the top.

in fact there is only one rule: "the rule of higher prices." sure "moral outrage" is nice...true as well...but still misses the larger point. The entire legal system exists "to not allow falling prices to materialize." this is how we are paying for everything...not just with higher prices in actuality...but more importantly "speculation that prices can only move higher" courtesy of the Federal Reserve's "inflation is our goal" mantra. And the lunatics have dutifully followed..."right into the natural gas abyss." Setting up the President as the fall guy for all this is a fairly straightforward procedure. Everyone agrees on the end (there's no profit in falling prices) and the means (the media will bind/torture and kill all those who speak out against it) so it really it all comes down to execution as they say. (extermination of even the concept privacy/mind martians for the hard core freedom fighters.) What TPTB can't have is an actual economy in which honest growth through hard work, innovation and just sheer brilliance is the result. Enter "the natural gas/cloud computing/solar power" debacle. This is where "collapsing prices allow certain physical spaces on the planet freedom from the madhouse of New York City." North Dakota obviously is one...though i'm not sure i'm ready to back my bags quite yet. Most of the midwest actually is starting to "feel the freedom" right now. I have focused in on Minnesota ("Minnesota nice" as they're called) but it is possible other places emerge as the total collapse of the taxpaying middle class results in a "state foreclosure crisis" in the USA of epic proportions. it's simple "market economics" now. everyone's house is worthless. the homeowner has no income STILL (but a debt load TPTB are willing to rollover provided we all agree to the lie of higher everything). their taxes are going up. the price of everything they must pay for is soaring. the (few) people causing this calamity are getting all the money (for now)--and an end game is now in sight courtesy of "the evil doers must kill the entire military PLUS all the veterans who have served in every war ever" to achieve it (not doable) AND they need a rock to hide under "once they do it" (and fail.) that about sum it up? oh, yeah..."and it's a bi-partisan effort as well." bi-partisan indeed! more like CRY PARTISAN from where i'm sitting. again folks here's the answer you all need to effect:http://www.youtube.com/watch?v=ND31PWVW-TQ&feature=player_detailpage

the problem with the populace, including myself, is the following: A major part of all the printed (= stolen) wealth went to the elite. But in the last decades a considerable part of the loot also went to average and middle class people. 99,99% have no clue of the fiat monetary system, but they know intuitively that if this ponzi system goes, a major part of their wealth goes, too. They protect it by not asking and not looking at it.

Look at it from this perspective.. the top 0.01% provide 80% of the lobby dollars to Washington DC.. and no matter how Congress or the Supreme Court Allows them to hide the contribution(s).. it will remain the lions share to be sure.

if you provide me with 80% of my earnings I will be listening to you about 80% of the time.. and voting for you about 80% of the time.. because this is America! we are capitalists! we pay people to perform work for us! when we dont feel like doing the work ourselves.

Washington DC is no different than a plumber.. no one likes shit on their hands.. so pay someone else to do it!

if anyone would like these FACTS sourced and Sited.. go to Google and LOOK THEM UP YOURSELF!

Never mind! YOU! ARE TO FAT AND LAZY TOO!!

and beside the Madison Ave. Meme's are ringing in your head.. the truth is SOOOOOOOOOOOO HARDDDDDDDDDDDDDDDDD TO FIND!!

Was Goldman Sachs was provided this PROMIS program to manipulate the markets, and to line the pockets of themselves and their favored ones, while also doing things to manipulate the markets the way the FED wanted. It might even be a part of the PPT activity.

No "name" was reported for the Goldman Sachs program in the media.But it bears striking similarities to the PROMIS program which has been the center of many an illegal and shady activity in the banking industry since the Clinton era and before.

before listening to this interview i would like to say
the sovereignty attributed to a collective, conceptually, and
known as "government" is manifest by code and law linguistically
and significantly represented in the physical "real" world as
currency and or money. as long as we have the monetary creation
process technically and primarily divorced from the "people"
or representatives of the people, the sovereignty of the people
has been usurped. the people and the government is then nothing
more than an authority over the people to be used by the de facto
sovereign entity that does primarily and technically control
the monetary system. aka the people and the "nation" are nothing
more than debt slaves to this actual authority. now i should
listen to this interview and watch for how the fundamental problem
will be avoided in the discussion. / i hope i'm wrong again.

the supreme court could rule that dinosaur farts
are diamonds but that doesn't make it so, does it?
they pride themselves on divorcing their determinations
and the language that they abuse from any potential
conflict associated with the real world or economy,
and that so the public will trust them.
strange weather.
no need to be sorry, but how is the empire just another
bank? most banks don't have nukes, an army, etc...
some might but the one i go to doesn't.
and the other thing is that even if we were to agree
that "money (or its use) is speech" not all forms
of speech are protected under the constitution. if they
were then it would be perfectly legal to pay off a judge to
achieve a desired determination in any court case. no?

The *real* power of the empire is exercised through money-flows, not through violence.

The military gets called out from time to time, but even then, it's the money that makes the system work. Take a look at the Iraq occupation for proof--when it was determined that our troops were unable to pacify the infighting amongst the locals, we just started PAYING THEM not to fight.

Consider what that suggests about foodstamps and Social Security.

As for your other questions--I'm pretty certain that "legal" is completely unrelated to "true" or "just." But that's another conversation.

@.." it's the money that makes the system work." ..
here a link.
Max Igan - a System of Perpetual Debthttp://geraldcelentechannel.blogspot.com/2012/03/max-igan-system-of-perp...
.
so "money" is not violence it is merely the threat of violence
against a third party who is not a direct participant in the
said transaction but stands, if possible, to make good on the
values assumed in the transaction of which they have no knowledge.
dylan said "money doesn't talk, it swears".
i think he was correct
.

I am shocked - SHOCKED! - at Ms. Morgenson's revalations, and shall write a letter to my elected representatives in Washington, D.C. forthwith. I'm sure they will launch an investigation which will lead to appropriate legislation to end this shocking abuse.

Her next shocking revelation: Some elected representatives accept innapropriate favors and money from large corporations!

no way, favors?. in the form of a bag full of
cash type favor? i don't find that credible and
would be shocked if it could be exposed.
it is curious that these "representatives" tend to
be financially well off but correlation does not
prove anything.
it's not like the entire legislative process is nothing
more than legislating special interest payoffs from the
treasury to organized criminals at the expense of the
taxpaying public, is it?

"weird disconnect"... g.m.
"deep dysfunction.."
right, there was a coup, love, and the country is
being run by f..ing traitors and bag men. it is what
we call the system, the monetary system is a hoax
and a ponzi scheme and you really can't rehabilitate
a ponzi scheme, can you? it is a bank robbery, treasury, taking place
in broad daylight and over a long period of time and all
these educated and professional economists and journalists
might as well be freaking blind and living in a cave.
enablers one and all no matter when the brilliance of a generation
is used to avoid the essential truth of the matter and in obfuscation
and denial or avoidance of the meaning of the simple truth.
we will never have the essential discussion? then we will fail
and be led to our own destruction for our own good and we will
be told to not only like it but love it, pray to it and for it,
even worship it as 2 + 2 = 911. hmmm.
that is some crazy shizzle

"Now this was the sin of Sodom: She and her daughters were arrogant, overfed and unconcerned; they did not help the poor and needy. They were haughty and did detestable things before me. Therefore I did away with them as you have seen". — Ezekiel 16:49-50

It all started with Greed. Greed has always existed but it reached new heights in our country. I will not bore anyone with the "greed is good" recap - but we went from a country in which hard work, invention or even technical brilliance was rewarded to one in which it did not matter how you acquired the wealth. Just the fact that you had it - made you one of the "elite".

Somewhere in that process many people (especially those with wealth) lost the interest in actually working. You want to make money on your money - don't do research - don't build a factory - don't take risks - give it to a hedgefund guy - it's his job to make you money - risk-free. You just run along and play with the other wealthy putzes - and complain about the outrageous taxes you pay and the ennui you experience.

Even the robber barons of history were better citizens than the elite of today. Andrew Freaking Carnegie was a saint compared to today's crop of Parasites.

It really was a failure in leadership and a collective failure of the people to hold the players accountable. Nothing will change until either the mores of society change - or until the system comes crashing down.

I would like to see change and here is what I am doing - first - start with yourself. Hold yourself accountable - and be honest with yourself and others. Try not to reward the poor behaviors of others with your fiat or your time. Turn the damned TV off. Vote against every incumbent out there (unless they are actually honest and doing their job - lobbyists be damned - that's what like 2%?) regardless of party affiliation. Communicate with the current office holders even though you do not respect them (and remind them what real leaders would be doing if we had any).

Above all, do not fall for the right vs. left bullshit. To loosely quote George W. Bush (roflmao) - "You're either for us or against us" and "us" is the majority of the responsible citizens of the U.S. - those paying taxes - income and otherwise. Rational politicians would work together to solve problems - regardless of party and stupid ideologies if they knew their jobs (power and prestige) depended on it.

of course wall street lives by a different set
of rules, that is the function of the sovereign.
they make the rules. they make the rules.
say it again, the sovereign makes the rules.say it again, say it again, the sovereign makes the rules.the sovereign makes the rules.
what rules apply to those that make the rules?
what laws apply to them? the ones that they
compose themselves. they self govern as they are
the sovereign. no?
but...there are realities in the real world of
energy and objects and peoples. realities.
the term coup, or regulatory capture might come
to mind. keyword: capture. how? that would be
financial capture as in bought and paid for, owned,
paid off, or kept by means of "control fraud" payouts.
nothing good will come from this "system". watch.
america, to see your future look to the islands to
the south, how they are treated by the global fiat money
"authorities". the sovereigns, independent, that cannot
control themselves would prefer to control the other,
that is you, through the issuance of paper money as
your debt to be paid to them in the future as you are
a good and reliable citizen and take the debts of your
"nation" as good and redeemable to be honoured by all.
amen.

Pay Blackwater to take some action. Just, JUSTICE for all. The needs of the many outweigh the needs of the few. Achieve your political goals--Arrest Corzine Now. Offer a million dollars to anyone with info that leads to Obama's impeachment. Down with the Banking scum of this world.

"I am shocked that it has not led to a really honest dialogue already, this crisis, because it was so large and so devastating and it hurt so many people that I thought 'Wow, this is really it. This is going to force the issue to be brought in to the open, to be discussed intelligently and to be resolved'. It just has not been..."

Discussed? By whom? The Pols, the presidential candidates, LOL? Sure, see how quick their deep pocket donors fade away. NO ONE in DC is gonna talk about it, they're gonna wait till the attention span of the sheeple turns back to Idol etc.

The “assault” started with the "commander of chief" of the Federal Reserve Bank of USA targeting all the countries; The CEO of the central public bank of the USA with the private funds, the public bank of the USA with the Club private funds. After the fall of the interest rates, they aimed at “flooding” West with “cheap” money, in order to destroy its industrial capital. They were turned to “giants” using unnatural means like the “air” of the housing loans in the USA and then they went out to the Planet to “sweep” everything. With the collaboration of the "generals" from the other side of the ocean they leveled everything. They just threw money to the market in a way destroying capital. They financed commerce and this exhausted production.

Using cheap money, traders exhausted producers within a few years. Citibank, Deutsche Bank under the auspices of the European Central Bank swept everything. They were the "pace-setters" and all the other banks of Europe were following. Abundant money turned industrial capital “useless” and this is what "shut them down". The “bombarding” of Europe was total and absolutely “leveling”. Within just a few years all the Western production was moved in China in just a few steps. Western countries ended up in total unemployment. The elimination of productions and the control of the market by the traders made the supreme capital of Copyright come true. This is the Club capital. The empire has started to “rise” over the dead “bodies” of factories.

"In spite of the Explosion in Financial Fraud from the mid 2000's, continuing unabated to this day, the number of Criminal Financial Institution Fraud Prosecutions under the Obama Administration is the lowest in 20 years....

If you remember the story of Animal Farm; the pigs exploit the other animals shamelessly, breaking all the rules that they had established after the Rebellion. And so it goes.

Back in the day Jerry "Kill the pigs" Rubin's good friend Abbie Hoffman would say: "Steal This Country!"

More recently President Obama's Good Friend Jeremiah Wright might say God Damn these criminals. His other "Good Buddy" Bill Ayers might say: These are criminals at large; taunting the public who will hunt them down like the dogs that they are... Lamp post provided by local communities nationwide, Cordage available at fine retailers everywhere, Final Justice; Priceless.

The desired change can't be achieved through violence. That just puts more violent people in charge again. What must change is the ideas and the personal actions of some significant portion (say 10%) of the people.

Remarkably, by doing just the following three things, the present rotten system could be permanently overturned inside ten years - without violence or legislation or politicians or "leaders". Individuals should

1. Take their money out of all banks and financial institutions (except perhaps those that do not fractionalize)

2. Homeschool

3. Eat a primal ("paleo") diet free of industrial foods, especially the grains that have enabled centralization and tyranny ever since the agricultural (and especially the industrial) revolution. (to see what primal eating is like you might like to check http://www.marksdailyapple.com//welcome-to-marks-daily-apple/)

I am serious about the third point. Grains are the foundation of the entire pyramid of the hierarchy of state power. Imagine the impact on government, the big and corrupt limited-liability corps, the media, and other parts of how we live if people no longer bought the "food" they sell us? It would be astonishing. It would be the anti-agricultural revolution and reverse the last 4000 years of the history of statist people-farming.

Anyway, these are three non-violent, personally beneficial, individual and family actions that people can take that would, without a doubt, smash the current system.

I think that has led to a very angry populace but also a sense that there are two sets of rules in the country.

Yes, there are two sets of rules.Duh.As long as we keep electing “Dems” and “Reps” that won’t change. Everyone gets that, right? But I don’t see a “very angry populace.”Oh sure, a lot of Internet posts (like those on ZH), a few marches…But an anti-status quo candidate (Paul) can’t buy support right now and from where I sit it looks like Obama has a pretty clear path to reelection over the ULTIMATE status quo candidate, Romney.And where are the billions upon billions flowing OUT of the TBTF – by your own research their assets have grown, not shrunk.

I am shocked that it has not led to a really honest dialogue already

Really?Who, exactly, is going to conduct this ‘dialogue?’And who, exact, is at the table from beyond the status quo?Washington?Wall Street?The media????It is great that there are (respectfully – I enjoy ZH) ‘chicken little’ sources like ZH, gold bug sites, etc.But there’s no dialogue because….Well, see answer above.

The trouble with third party candidates is that, for the most part, they’ve been kooks.While I love Ron Paul’s message when he focuses-in on economic issues, it is when he drifts off into lah lah land with his drug policies, foreign policies, etc. that he loses the American voter.He would be lucky to garner 2% of the vote as an independent.

So if you want a real dialogue then we’re going to have to start having real INDEPENDENT individuals who are something other than Libertarian drug heads, environmentalist and world peace candidates.And a little REAL angry populace wouldn’t hurt.Turn off the Internet and get something done, people!!You’re talking/posting in a dark, empty room right now!